Second Home Mortgage - not BTL

Springman

Hi All,

I currently have a joint mortgage with my mum on a house she lives in, but I'm looking at getting another joint mortgage with my girlfriend so we can buy a place together.

I'm interested in knowing how mortgage companies will calculate the affordability for the second joint mortgage. We are looking at buying a house worth £300k and have a 20% deposit so would need a mortgage for £240k

After an initial talk with Barclays, they will combine our income together (£85k) and multiply by 5, allowing us to borrow £425k which is more than sufficient.

However, the joint mortgage I have with my mum is at £225k (house worth £290k), so they will minus that figure from what we can borrow meaning through Barclays we can actually only borrow £200k.

Is this typically how most companies will work out affordability for a second mortgage?
I don't entirely agree with the way Barclays work this out as if my mortgage payment was only £10 a month or £10,000 a month it wouldn't make any difference on what we could borrow.

I read bits and bobs that the affordability can also be calculated by taking the annual mortgage repayment for my first house and deduct that from my salary. Then combining my 'new' salary with my girlfriend and multiple by 4 allows us to borrow £268k, which would be perfect.

I cannot seem to find any information on the net for this type of circumstance.

I obviously can't turn my first house into BTL as my mum lives there and I guess she can't be a tenant and owner at the same time.

Any advice or knowledge parting is very welcome!

GMS

All lenders are different bu they will all take the current mortgage into account as it is a residential and not a self financing BTL.

Woolwich require a set disposable income according to your family set up so this would need to be left after deduction of all commitments. For their 'adviser' to flatly say 5x income is potentially very misleading, as with a large mortgage in the background you will more than likely be restricted to much less.

The mortgage with your mother is joint, and as a result you are both jointky liable for the repayments so the full amount would be included as a commitment.

Without knowing your full circumstances it is difficult to say but I think you may be over ambitious with those figures.

Speak to a 'Whole of Market' adviser to see if there is a way forward for you.

Thrugelmir

Springman wrote: »

Is this typically how most companies will work out affordability for a second mortgage?
I don't entirely agree with the way Barclays work this out as if my mortgage payment was only £10 a month or £10,000 a month it wouldn't make any difference on what we could borrow.

Forget affordability. You are liable for the outstanding debt. Thats the issue.